International trade is defined as
trade between two or more partners from
different countries (an exporter and an importer).
Early international trade consisted mostly of
barter transactions.
International trade is also a branch of
economics. Traditionally, international trade
is justified in
economics by
comparative advantage theory. New developments
include in patterns of international trade: the
integration of countries into
trade blocks (eg.
European Union,
NAFTA,
EFTA,
CEFTA[?]) and
globalisation.
The risks that exist in international trade can be
divided into two major groups:
- Risk of insolvency of the buyer
- Risk of protracted default - the failure of
the buyer to pay the amount due within six
months after the due date
- Risk of non-acceptance
- Risk of cancellation or non-renewal of
export or import licences
- War risks
- Risk of expropriation or confiscation of the
importer's company
- Risk of the imposition of an import ban
after the shipment of the goods
- Transfer risk - imposition of exchange
controls by the importer's country or foreign
currency shortages
See also:
OPEC,
World Trade Organisation,
Business,
Economics
